If you're still not sure about culture, read this.

In 2000 I was a Silicon Valley engineer working for Polycom. I had friends at places like Yahoo, Google, Ebay, and Nvidia. Every company in town bragged about their culture. What was culture?

Free food. Free loaner bicycles. Free massages. Free everything. Unlimited vacation. Huge parties.?

One of my friends said there was so much free stuff that he could literally live there and work 80-hour weeks. He did.

Those things aren’t culture. They’re perks. They’re nice, but they can disappear in an instant. They did.

So what is culture? And what good is it?

Culture is the part of your company that you can’t control.

It’s how people feel about working for you. It’s whether or not they eagerly give their best. It’s what they say when you’re not around. It’s what tells employees which of your orders they have to care about and which ones they can ignore.

You can’t dictate it, but you can influence it.

"Hang on, Matt. People come to work to get paid, right? They do their jobs; you pay them. Why care about all this fluffy, feel-good, culture stuff?"

Imagine two companies that look like this:

Company 1

John struggles to find adequate talent. Employees frequently leave after getting trained but before they produce real value, which he says is why the business isn’t growing. Employees seem to do the minimum necessary to keep their jobs. Customers always complain about price, never give good referrals, and regularly stress out the employees. Sales and revenue are ok, but for some reason they’re always getting by on cash flow.

Company 2

Mary has had the same team for years. They work great together, which Mary says is the reason for their growth. Customers know the employees by name. Many of the customers have been with them for decades–often with multiple generations. The owner has a lot to do, but it’s really fulfilling to be part of such a great community. And she gets to work on CEO things, not babysitting or supervising the team. Mary consistently has excess profits to reinvest into making the business better.

The Purpose of Culture

These examples illustrate the purpose of promoting a strong company culture:

to become the right place for the right kind of employees and the right kind of customers to produce the right kind of outcomes.

Maybe you’ve heard that Peter Drucker said, “Culture eats strategy for breakfast."

Is it true?

Well, consider this: your employees execute your strategy. If your company is remotely healthy, your employees will be around while you change strategies multiple times.

Then if your employees' attitudes and behaviors are a reflection of your culture, and your culture is not great, what’s going to happen to your strategic execution?

So yes, culture is critical. But if free sandwiches don’t produce a great culture, what does?

Two Ingredients of a Great Culture

The same thing that produces great customer relationships: personalization and relevance.

Maybe you’ve had the experience of exceeding expectations at a company, only to be laid off and told, “It’s nothing personal.” But it is personal, right? It’s always personal.

Employees and customers are attracted to companies that recognize them and appreciate them as individuals, not as IDs in a database. Companies that focus on relationships, not transactions. People, not things.

And they also want something that’s relevant to them. Understanding customers well enough to be hyper-relevant is probably the biggest way to un-level the playing field. And with employees, it’s how you get talent that's a good match for the company and the job.

If you think jobs and deals are about the exchange of labor, wages, products, and paid invoices, you're on your way to an MBA, but you haven’t figured out people, and the opportunity cost is exorbitant.

BTW, You Already Have a Culture.

I’ve seen smart people at HR or leadership conferences say, “We’ve decided that our company needs to have a culture.”

Sorry to be the bearer of bad news, but every organization has a culture. Whether or not it’s the one you want is another matter. And if you don’t know, then it probably isn’t.

In many companies, mid-level supervisors who call meetings to read the suggestion box notes and figure out who the complainers are will often talk about culture, having heard it mentioned in a Ted Talk at some point. They think they’ve cultivated a great culture, and you had better believe them, or else!

Where to Start

If your business has reached the point where this is really starting to matter–if it has your attention but you’re not sure what to do about it (other than inventing perks)–take another look at the purpose of a culture:

To become the right place for the right kind of employees and the right kind of customers to produce the right kind of outcomes.

If you take those in reverse order, you start with the “right kind of outcomes”.

That’s a perfect place to start your journey toward a great company culture that will run your company well for many years to come.

If your “right kind of outcomes” is strictly making money, or if it’s the pursuit of money decorated in the language of something nobler, you’re not going to get far.

Your employees and customers ultimately don’t care how much money you make. If you make it all about money, so will they.

You need a loftier purpose than that. And that’s where you start: by defining your shared purpose. A reason for the organization's existence that is shared by you and everyone who works for you.

If you and the right kind of talent are to be mutually attracted, your shared purpose will bring you together and bind you together.

Here are some infamous, generic purposes (“missions”) that nobody cares about:

• Maximizing shareholder value
• Being the premier provider of widgets in the markets we serve

Nobody is searching for that company in hopes of submitting their resume.

By contrast, Client Focus’s shared purpose is this:

“Elevate employees’ careers. Transform small businesses. Protect more people.”

And we live and breathe those things in that order. Everyone. Every day. We don’t know how to have conversations about the direction of our company without those things. People who work for us buy into the mission before they’re hired.

What does that purpose represent? As a company it represents WHY WE ARE IN BUSINESS. As individuals it represents WHY WE COME TO WORK.

So that’s your next task if you really want to begin to shape a culture that will serve you well in the future: Define your shared purpose.

If you invent it in 3 minutes, you did it wrong. You need to give this a month or two and write and erase 1000 words until you get it right. It needs to resonate down in your soul. It has to express the essence of what will make you proud of your company.

And that matters, because the best way to make a lot of money AND be fulfilled over time is to focus on being a great company, not on making a lot of money.

Of course there's more to do, like verbalizing your vision and your values, and then figuring out what mutual alignment looks like between the company and the workforce. But purpose is a great place to start.

Hey friend, if this article gave you something to think about, consider subscribing to my newsletter:?Matt Wagner's Growth Insights. Every week or so I'll share something that will help you break out of the status quo and reimagine how you grow your business.

About Matt Wagner:?I'm a veteran of the tech industry who found his happy place helping leaders grow their organizations. I focus on culture, talent, strategy, and profit. I'm available for coaching and speaking engagements. Shoot me a DM and let's chat.

? 2022 Matt Wagner. These are my ideas and do not necessarily reflect the opinion of my current or past employers.